Subject : Ruling on the Increase Charged against Adding Previous Years of Social Security Contributions
Fatwa Number : 2020
Date : 06-05-2012
Classified : Current Financial Issues
Fatwa Type : Search Fatawaa

Question :

We are a group of employees who were subjected to social security, but, later on, were transferred to the Civil Service System. As a result, we were given financial amounts against our contributions. After retirement, we were re-employed and re-subscribed in social security based on the old social security number. We asked the Social Security Corporation to add our previous years of subscription, but were told that we must give back the amounts that we took, in addition to their profits. Is it permissible that we pay these amounts with profits so that the previous years are added to the period of our subscription in social security?

The Answer :

All perfect praise be to Allah  the Lord of the Worlds. May His peace and blessings be upon our Prophet Mohammad and upon all his family and companions.

Resolution (133) issued by the Iftaa` Council included a Fatwa which  made clear that it is permissible to subscribe in social security. Moreover, the amounts paid by citizens to the Social Security Fund are framed as donations against the Fund`s taking care of the them in case of retirement, disability, death and the like. Therefore, it is permissible for the Social Security Fund Management to establish specific terms and conditions showing the amounts to be given by regular subscribers and those wishing to add previous years of subscription. This is whether these amounts are more or equal to the subscriptions of the latter. However, this increase isn`t considered forbidden usury, because usury is a conditioned increase in a special commutative or loan contract. The money paid as regular subscription or renewal of subscription is a donation, not a loan or commutative contract, as framed by the aforementioned resolution.

After checking with the officials of the Social Security Corporation, it was agreed that this conditional increase isn`t included in the idiomatic definition of the usurious interest and it isn`t permissible to give it this name or description. And Allah the Almighty Knows Best.




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